August 2011

New Prosperity plans would save lake

Taseko pursues federal approval a second time

-By
Peter Braul

Taseko’s revised plan for the New Prosperity mine would not require Fish Lake, which is upstream from the proposed mine, to be drained | Courtesy of Tsilhqotìn National Government

Brian Battison was shocked and disappointed last November when the federal government turned down Taseko Mines Ltd.’s Prosperity Mine plan. “It took some
time to digest,” said Battison, Taseko’s vice-president of corporate affairs. “It was several days for us to try to understand what the decision meant, and
to carefully read the decision.”

The Prosperity Mine site, which is said to contain the world’s seventh largest gold and copper porphyry deposit, sits directly downstream from Fish Lake.
Taseko had proposed that the lake be drained, filled with waste rock and replaced by another lake for the community to access.

Environment Canada, in explaining its decision, stated that it accepted the public findings of a federal panel created to review the project. The report
from the panel, published in July 2010, found that the Taseko project, as proposed, “would result in significant adverse environmental effects on fish and
fish habitat, on navigation, on the current use of lands and resources for traditional purposes by First Nations and on cultural heritage. The Panel also
concluded that the Project, in combination with past, present and reasonably foreseeable future projects, would result in a significant adverse cumulative
effect on grizzly bears in the South Chilcotin region and on fish and fish habitat.”

But Taseko had a backup plan. In the process of designing the mine, the company evaluated several options that did not involve draining the lake, but had
settled on the less expensive option. “There were always ways to build the project differently, but there was only one way to do it that was economical at
the time,” said Battison.

Because consensus prices for both gold and copper are now significantly higher, plans that were not feasible before were brought to the forefront to
address the government’s concerns. The new project description, which Taseko submitted June 6, would cost the company an additional $300 million. It would
save the lake and reduce the area of environmental disturbance by 23 per cent.

According to Battison, most of the extra funds would go towards transportation, as tailings and waste rock would have to be moved elsewhere in order to
avoid damage to Fish Lake. Under the new plan, the tailings dam will be moved two kilometres upstream from Fish River’s entrance to Fish Lake, where it was
originally planned to go, and tailings will be pumped that distance for the entire 20-year life of the mine. The new plan would also have waste rock moved
to the east, away from the lake.

Battison said that many thought the lake was going to serve as a tailings pond, but that was never Taseko’s plan. And while many reports have said that the
new plan would make Fish Lake inaccessible for 20 years, Battison said that is not true either. “That lake can be made accessible,” he said. “It can be
designed in such a way to retain trees and foliage around it.”

Despite Taseko’s attempts to resolve federal concerns, misunderstandings with First Nations could throw a wrench into things. “Taseko was adamant… that the
proposal featured in their [first] application was absolutely the only feasible/viable option,” said Grand Chief Steward Phillip, president of the Union of
BC Indian Chiefs. “Now, Taseko is saying something that completely contradicts their earlier assertions.” On those grounds, First Nations have refused to
consult with Taseko over the new plan, but whether their stonewalling tactics have any impact on the federal decision remains to be seen.

The Supreme Court has ruled that First Nations have a treaty right to be honourably consulted, but do not hold veto power. However, a United Nations
declaration that First Nations have the right to “free, prior and informed consent” appears to challenge that, since First Nations could refuse consent
without consulting with anyone. When the federal review will be complete is difficult to say.